Personal Finance: There's no such thing as a free lunch

Owning shares is not just about waiting for their value to rise. Some companies offer additional inducements, including discounts on alcohol, dry cleaning and travel, to their shareholders. But, as Paul Slade explains, a move to paperless share trading may mean these perks have had their chips. Harry Ramsden's fish and chip shops are often seen as a Mecca for anyone lusting after a typically British deep-fried treat. So successful is the company that it has expanded beyond its flagship shop in Yorkshire, opening new stores in other parts of the UK and abroad. A Stock Exchange flotation took place a few years ago.

For investors in Harry Ramsden, ownership of 500 or more shares also means an extra perk: they qualify for a twice-yearly free-fish gala at its main shop in Guiseley. However, one unexpected effect of the Stock Exchange's move to a computerised trading system called Crest could be to rob them of this delight.

Until now, all shareholders have received a paper share certificate in their own name. But Crest means small investors will soon either have to place their shares in nominee accounts or face higher dealing charges. So far, it has been possible for small investors to ignore Crest, but the system will start to bite for them as early as spring next year.

Nominee accounts are generally operated by the broker used to buy the shares, and listed by the company's registrar in that broker's name. There is no guarantee that shareholders in nominee accounts will get the perks they would otherwise be entitled to.

These perks often amount to little more than a handful of money-off coupons which can be exchanged at the company's shops but some are more valuable. Lookers Group, a car dealership, will give shareholders a cheque for pounds 100 when they buy a new car at one of the company's 40 garages in England and Northern Ireland.

The deal is limited to one car a year, but available on purchase of even a single pounds 1 share. Even with a typical execution-only stockbroker's minimum dealing charge of about pounds 25, buying a single Lookers share could still produce a saving of some pounds 74.

The company has sent out about 15 cheques of pounds 100 to shareholder customers so far this year.

John Hoyle, Lookers assistant company secretary, says: "We don't deal with nominee accounts at the moment. We say it's got to be for a named individual. Clearly, we're going to have to review that in light of Crest.

"We will be sympathetic to nominee holders, because we don't want our people to suffer dealing charges by keeping the shares in their own name."

Mark Milligan of Barclays, the registrar responsible for Lookers shares, says: "It depends on the individual company, whether they are willing to pass on the perk to private individuals who've got their shares in a nominee."

Bristol stockbroker Hargreaves Lansdown, which produces its own guide to share perks, says investors who consider these perks important should call the head office of the company in question to check its policy on nominee accounts before buying.

Regent Hotels is another company which requires no minimum shareholding to qualify for perks, in this case a 15 per cent discount on accommodation, food and beverages at the group's hotels.

One shareholder has just four shares (total value: about pounds 1.80) but gleefully claims his discounts anyway. "People certainly buy our shares in order to get the discount card, use and then sell," says a Regent Hotels spokeswoman. "We have evidence of that."

Regent shareholders using a nominee account can still get their perks, but will have to jump through a few hoops first. Discount cards go out automatically to people holding the shares directly, but nominee holders will have to ask for them.

This means persuading the broker operating your nominee account to write to Regent's head office confirming that he holds shares on your behalf. Many, it seems safe to assume, won't bother. Other companies are less generous than Lookers and Regent Hotels, both in the perks they offer and the number of shares needed to qualify.

Sketchley demands you own 1,000 shares, 300 of which you must have held since 14 December 1990, before they will give you 25 per cent off your dry cleaning bills. Rival cleaners Johnson Group offer the same discount on holdings of just 200 shares. Burton Group insists you hold 5,000 shares before qualifying for a 12.5 per cent discount in its shops.

The issue of nominee accounts to one side, the Harry Ramsden offer remains one of the most intriguing. Investors are offered not only free fish and chips at the company's gatherings twice a year, but promised that "celebrities will also be in attendance".

If this conjures up visions of Madonna chomping on a saveloy, however, shareholders sadly are in for a disappointment. The celebrities in question have included Labour MP Austin Mitchell and Bullseye presenter Jim Bowen.

On 18 November, Harry Ramsden plans to treat qualifying shareholders to Opera and Chips, when Opera North will perform in the Guiseley store. "That's been overwhelmingly oversubscribed," says organiser Irene Ellis. "They come from the length and breadth of the UK."

It may not be pate de foie gras to the sound of trumpets, Sydney Smith's definition of heaven, but mushy peas and arias seems a pretty good second- best.

For a free guide to shareholder perks, call Hargreaves Lansdown on 0800 850661 or Barclays Stockbrokers on 0345 777400.